Civil society groups welcome UNEP plans to measure green finance

Civil society work paves way for UNEP plan to measure green finance performance

Initiatives will support the financing of UN sustainable development goals

Brussels, 7 October 2016 - Civil society leaders in Europe today welcomed news that the United Nations Environment Programme’s Financial Inquiry is leading the development of a framework to measure the alignment of finance sectors with sustainable development, focusing initially on green finance (see UNEP press release).

Benoît Lallemand, Convenor of the Citizens’ Dashboard of Finance initiative and Head of Strategic Development at Finance Watch, said:

“We welcome UNEP’s plans for a green finance performance framework based on empirical data and are delighted that the proposed performance framework uses a similar approach to that taken in the civil society-led Citizens’ Dashboard of Finance.

“In partnership with the Green Economy Coalition and others, we will continue to build the scope and content of the Citizens’ Dashboard of Finance in the coming months, and hope it will continue to serve as an ambitious, democratically legitimate compass for UNEP’s performance framework.”

Oliver Greenfield, Convenor of the Green Economy Coalition, said:

“We all missed a huge opportunity to reform the financial system following the crisis – not just elected officials, policy makers and supervisors: civil society as well. The momentum for greener - and fairer - economies has reached a tipping point and can inspire a transformation.

“GEC has followed closely the UNEP finance inquiry from the beginning and we support their ongoing work on a performance framework. We will continue to work with them, and with Finance Watch and our other members, to build a shared narrative for how transformation can come about, a set of metrics backing our assessments and, most importantly, an ambitious ‘change finance’ agenda for the years to come.”

Civil society leaders met two years ago to create the Citizens’ Dashboard of Finance, prompted by evidence that the post-crisis financial reform agenda has not fundamentally changed the financial system. The prototype of the Dashboard (www.citizensdashboardoffinance.org) contains more than 40 performance indicators that focus on key outputs of the financial system: how it impacts on the environment, sustainable development, political processes, productive investment and speculation, financial stability, jobs and well-being, trust and transparency.

The UNEP Financial Inquiry’s initial version of a performance framework, which will be introduced in a report presented at the IMF summit in Washington DC today, includes a set of 21 country-level indicators relating to green finance. In a second phase, UNEP plans to broaden the scope of the framework beyond green finance, increase the number of countries covered, and integrate the indicators with national assessment frameworks.

Catherine Howarth, Chief Executive of ShareAction, said:

“UNEP are absolutely right that a ‘quiet revolution’ is underway in aligning finance to sustainable development. The framework being developed by UNEP can, like the Citizens’ Dashboard, bring more transparency to our financial system, empowering savers to turn the quiet revolution into one too loud to be ignored.”

Christine Berry, Principal Director for Policy and Government at the New Economics Foundation, said:

“With financial stability concerns still high, future iterations of UNEP’s performance framework must reflect society’s broader concerns about the economy and financial stability as well as the environment. This should include progress on tackling business models that distort capital allocation or create systemic risk, such as too-big-to-fail universal banks, which are themselves barriers to sustainable development.”

“Data and indicators are key to supporting a vision of what the financial system is today and where it is heading. We urge UNEP to ensure that its performance framework can evolve beyond green finance to reflect wider sustainable development goals. The addition of UNEP’s country-level data should also encourage financial sectors to compete on, and create innovative business models to deliver, sustainability, inequality and financing for the real economy.”

Christophe Nijdam, Secretary General of Finance Watch, said:

“By measuring the real world outputs of the financial system, both the Citizens’ Dashboard and UNEP’s performance framework will help policymakers and the public to see if commitments to finance sustainable development goals are being kept. On a practical level, they could improve the ability of markets and policymakers to identify risks and identify emerging trends.”

The second edition of the UNEP Inquiry’s global report, “The Financial System We Need – From Momentum to Transformation”, October 2016, will be presented at an event in Washington DC on 7 October at the IMF Annual Meetings, hosted by UNEP, Bloomberg, the IIF, SIFMA, the Paulson Institute, and the Toronto Centre. The report is available at http://unepinquiry.org/progress-report.

The United Nations Environment Programme (UNEP) Inquiry into the Design of a Sustainable Financial System is working to advance systematic action to align the financial system and Sustainable Development.

The “Citizens’ Dashboard of Finance” gathers nearly 30 civil society stakeholders to define what society wants from finance, measure how well finance is meeting those needs and map solutions to transform the system. The prototype of the Dashboard collects indicators to show how the financial sector affects society in a variety of areas, including its contribution to the financing of climate objectives (www.citizensdashboardoffinance.org). The Dashboard project is run by a steering committee comprising Finance Watch, SOMO, Veblen Institute, NFU, ShareAction, Friends of the Earth Europe, Fondazione Culturale Responsabilità Etica and Housing Europe.

Finance Watch is an independent, non-profit public interest association dedicated to making finance work for society. It was created in 2011 to be a citizen’s counterweight to the lobbying of the financial industry and conducts technical and policy advocacy in favour of financial regulations that will make finance serve society. Its 70+ civil society members from around Europe include consumer groups, trade unions, housing associations, financial experts, foundations, think tanks, environmental and other NGOs.

The Green Economy Coalition (GEC) is a global network of organisations committed to accelerating a transition to a new green inclusive economy. Members include NGOs, research institutes, UN organisations, businesses and trade unions. GEC’s vision is of a resilient economy that provides a better quality of life for all within the ecological limits of the planet. Its mission is to accelerate the transition to a new green economy.

ShareAction is a UK registered charity that promotes responsible investment practices by pension providers and fund managers. ShareAction believes that responsible investment helps to safeguard investments as well as securing environmental and social benefits.

New Economics Foundation (NEF) is the UK's leading think tank promoting social, economic and environmental justice. Our aim is to transform the economy so that it works for people and the planet.

The Finance Innovation Lab is a registered charity that incubates the people, ideas and movements building a financial system that serves people and planet.